NEW YORK – Everlast announced late Friday afternoon that it will be settling with Hidary Group Acquisitions, a company that tried to block the boxing and fitness brand’s merger acquisition by Brands Holding Limited. Under the settlement agreement, Hidary’s lawsuit against Everlast will be dismissed “with prejudice.”
The dismissal of the Hidary lawsuit came after Everlast agreed to “removing significant impediments to Hidary’s ability to compete economically on a level playing field to acquire Everlast,” according to a statement from Hidary.
Everlast had announced its acquisition in late June by Brands Holdings Limited, a private company based in England and Wales, for $33.00 a share, a cash transaction totaling more than $168 million. Brands Holdings Limited is a subsidiary of Sports Direct International plc, a publicly-traded company on the London Stock Exchange.
This move spelled the termination of an earlier $26.50 per share agreement with Hidary, and was subject to a $3 million penalty for Everlast. Hidary responded with a lawsuit to force Everlast to complay with its original agreement. Hidary owns a 36.1 percent stake in Everlast.
On July 25, Burlingame Asset Management, a firm that owns 14.3 percent of Everlast, sent a letter to the Everlast board in protest over the way the company was handling its sale. The investment group preferred the Hidary offer, which included an option for shareholders to roll over up to 50 percent of their interest into the company after the sale.